With the election now firmly over and the stability of Downing Street secure, in Epsom (as in the rest
of the UK) average wages are beginning to grow faster than inflation. This is good news for the
Epsom housing market, as some buyers may be willing or able to pay higher prices given the more
certain political outlook and attractive inexpensive mortgage rates. However, sellers who think they
have the upper hand due to the lack of property for sale, should be aware that we should start to
see an increase in the number of people putting their properties on to the market in Epsom giving
buyers some extra negotiating power.
At the last election in May 2010, there were 602 properties for sale in Epsom and by October 2010,
this had risen to 768, an impressive rise of 28% in five months. An increase in the supply of
properties coming on to the market could tip the balance in the demand and supply economics
seesaw, thus potentially denting prices. However, as most sellers are buyers and confidence is high,
this means there will be good levels of property and buyers, well into the summer, as demand will
continue to slightly outstrip supply.
It is important to consider what the uncertainty in April did to the Epsom property market. I
mentioned a few weeks ago that property values (i.e. what properties were actually selling for) had
remained static in March 2015. Now new data has been released from Rightmove about April’s
asking prices of property in Epsom. It shows that pre-election nerves finally came home to roost in
the final weeks of electioneering, with the average price of property coming to market only
increasing by a very modest 1.1% (April is normally one of the best months of the year for house
price growth).
I am sure our local MP, Chris Grayling, would agree that the biggest issue is the lack of new
properties being built in Epsom. The Conservative manifesto pledged to build 200,000 discounted
starter homes for first-time buyers in the next five years. For Epsom to gets its share, that would
mean only 75 such properties being built in Epsom each year for the next five years, not much when
you consider there are 41,434 properties in Epsom.
Housing is not a big issue for Conservative voters and because London is an increasingly Labour city
where the biggest housing issues are found by a country mile, so will it remain on the ‘to do list’ but
won’t get the recognition it deserves. Until another political party gets back into power, nothing will
seismically change in the property market, thus demand for housing will continue to outstrip supply,
meaning property values will increase (good news for landlords). However, as rents tend to go up
and down with tenant wages, in the long term, rents are still only 7.4% higher than they were in
2008 (good news for tenants)... with renting everyone wins! If you want to know what (and would
not) make a decent property to buy in Epsom for buy to let, then one place for such information
would be here at the Epsom Property Blog or by emailing me at
ian@directresidential.co.uk
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